PUCL Bulletin, March 2005

Repeal the patent ordinance
- By Rajindar Sachar

The real face of globalization and the danger it poses in poor country like India are now coming home to roost. This has reference to the Patent Amendment ordinance 2004 issued by Central Government by which India is going to switch over to product patent as against the existing process patent. It is a mystery as to why many of the redeeming provisions permissible even under the Trips agreement have not been included. The ordinance in its present form makes the accessibility; and availability of medicine at low cost very difficult thus affecting the health of people at large.
To give an instance the antiretroviral (ARV) drugs (to combat AIDS) for which multi-national pharmaceutical companies used to charge about US dollars 12.000 annually per person but were compelled to reduce price because India under the existing process patent regime introduced the generic version of the ARV drugs and the price fell down to US dollars 140 annually per person.

Countries like Pakistan under Product patent are already reeling under monopolistic prices charged by Multi-national Corporations (MNC) The network’s Newsletter of Pakistan of September 1996 notes “Pakistani consumers could have saved over rupees one billion on only nine medicines in 1995 if the companies would have offered the same price as they do in India. Pakistani consumers paid Rs.1,7,02,883.000 for buying these 9 medicines (14% of the retail market). These drugs are marketed by the same companies in India as well but at much lower prices.
If patients in Pakistan were offered by these companies the same prices, their medicine bills would have come down to one –third (a 66% saving) or they would have saved a staggering amount of Rs.1,049,493.000”. The present saving could even be still more phenomenal at current prices. It may be noted that Anti Inflexilant Cipro Flexocine (10 tablets costing Rs.50 in India costs Rs. 400/- in Pakistan Anti Ulcer Medicine Rantidina costing Rs.5 per packet in India cost Rs. 74/- in Pakistan.

Faced with this reality of unbearable burden on the poor in India some of us have been urging the Govt. against amending the law to switch over to product patent. But even it does not have that political will to take on the challenge of multinationals supported by USA. Central Government has no justification not to make suitable changes permissible even under the Trips when Doha Declaration on public health declared that Trips should be interpreted and implemented in a manner supportive of WTO members rights to protect public health and particularly to promote access to medicine for all.

Our present Patent Act strikes a balance between the property rights of a patentee in medicine and the public interest involved in cheap availability of medicine, by empowering Controller of patent to grant a license to produce commercially any such product to any person on such terms as he think fits even if the patentee has refused to do so. This equitable provision has also been accepted by Doha Declaration-2001. Following this, Brazil, Canada, China provide for compulsory license being granted on reasonable terms if the patentee has refused to do so in spite of commercial terms having been offered. The deliberate omission of this public interest provision in the ordinance even though permitted under the Trips agreement is impossible to explain when it is well known that the absence of such provisions for compulsory licensing, will only benefit the MNC who will have a field day to charge any monopolistic prices.

Another serious flaw is that it proposes to do away with the effective pre-grant opposition procedure. Currently there are 6000 applications pending (received during 1995-2004).Though formally permitting a pre-grant opposition to the grant of patent, ordinance-2004 incredibly makes a mockery of this right by stating that a person who is opposing the grant will not be given any hearing by the controller. This reduces the pre-grant opposition virtually to a mockery, and is doubly objectionable when countries like Australia, New Zealand, Pakistan have granted full pre-grant hearing to the objector. This denial will lead automatically to the grant of Patent to the majority of these 6000 mail box applicants. This will have disastrous effect on those of local manufacturers whose products are already in the market. They will be in danger of being charged with infringing the patent. A provision has therefore to be made that any products which are already in the market between 1995 and 2004 would be immune from challenge for infringing any patent which may be granted to any of these 6000 applicants.

The Ordinance has not properly incorporated the August 30th Decision of the TRIPS General Council, which permits the grant of compulsory licenses for export purpose to countries with no or insufficient manufacturing capacity in the pharmaceutical sector. The Ordinance proposes to permit compulsory licensing to a country with no or insufficient manufacturing capacity in the pharmaceutical sector, if there is a corresponding patent in the importing country. This ignores the fact that in many instances, there may not be any patent protection in the importing country because the deadline for Least Developing Countries (LDCs) to comply with TRIPS is 2016. In such a situation the Indian Drug companies would not be able to export to LDCs thus leaving the field open to MNC.

With all these dangers concerning public health. Ordinance is not an option. These are matters which need to be debated fully in the parliament. The facile explanation that if ordinance was not issued, it would violate the 1 st January, 2005 deadline by which India was expected to change the patent law to comply with Trips and incur penalty is an imaginary ghost. UK, France, Argentina delayed making amendments to conform to trips by 3 years, 1 year and 4 year respectively without having been imposed any penalty. Why then such a panicky reaction from our Government remains unexplained.

The only option to the government claiming to speak for the poor is to immediately repeal the Ordinance-2004. This matter must be left to the wisdom of the representatives of the people in parliament .

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